Borrow
Employment trend indicative of further cash rate decline
Progress towards full employment has stalled in the last six months, according to an economist who expects a flow-on effect to be reflected in changes to the cash rate in coming months.
Employment trend indicative of further cash rate decline
Progress towards full employment has stalled in the last six months, according to an economist who expects a flow-on effect to be reflected in changes to the cash rate in coming months.
Commenting on ABS Labour Force data at the end of last year, Dr Sarah Hunter, BIS Oxford Economics’ chief economist, said that looking at the labour market’s underlying trends, the workforce participation rate has fallen back as unemployment rates and underemployment rates both plateaued.
She forecast that wage growth is unlikely to reach 3 per cent year-on-year in the next 12 to 18 months, limiting the upward pressure on price inflation, and suggesting “a softer pace of growth in employment in the near term”.
As a result, Dr Hunter said she expects the Reserve Bank of Australia to cut the cash rate again early in 2020, taking it to 0.5 per cent.
“And if there are signs that conditions are deteriorating, we would expect the RBA board to implement further loosening (possibly including quantitative easing),” she concluded.
RELATED ARTICLES
About the author
About the author
Banking
Banks urged to embrace existing payment technologies over AI hype
In the rapidly evolving landscape of financial technology, the focus has increasingly shifted towards artificial intelligence (AI) as the next frontier for innovation. However, Ian Boyd, General ...Read more
Banking
EMEA banks enjoy profit growth amid revenue challenges in 2025
In a year marked by economic turbulence and geopolitical uncertainties, the largest banks across Europe, the Middle East, and Africa (EMEA) have reported a paradoxical trend: shrinking or stagnant ...Read more
Banking
Australian major banks demonstrate resilience amid economic uncertainty
In the face of economic headwinds, Australia's major banks have reported robust half-year results, showcasing their resilience amid rising uncertainty. According to KPMG’s Australian Major Banks Half ...Read more
Banking
RBA's new ruling on card surcharges sparks debate among businesses and banks
In a significant move aimed at enhancing transparency and fairness in the Australian payments landscape, the Reserve Bank of Australia (RBA) has announced the removal of surcharging on debit, prepaid, ...Read more
Banking
Australian SMBs lose two business weeks annually to late payments, report finds
In a startling revelation, the latest report by GoCardless, a global bank payment company, highlights the crippling impact of late payments on small and medium businesses (SMBs) across AustraliaRead more
Banking
Brighten’s reverse‑mortgage bet: why a niche product could be non‑banks’ next profit engine
Brighten has created a dedicated reverse‑mortgage leadership post, signalling a strategic push into equity release as Australia’s demographic curve tilts older and wealth concentrates in housingRead more
Banking
Why banks are moving at different speeds after the RBA hike — and how to turn timing into advantage
The Reserve Bank’s latest cash rate move has triggered an uneven response from lenders — a pattern that reveals more about funding structures, risk appetites and systems readiness than headline ...Read more
Banking
ANZ’s company-borrower mortgage clampdown: a risk reset with wide spillovers for SMEs, investors and non-banks
ANZ has tightened credit settings for home loans where the borrowing entity is a company — a narrow policy change with broad commercial consequences. It signals a shift in risk appetite across ...Read more
Banking
Banks urged to embrace existing payment technologies over AI hype
In the rapidly evolving landscape of financial technology, the focus has increasingly shifted towards artificial intelligence (AI) as the next frontier for innovation. However, Ian Boyd, General ...Read more
Banking
EMEA banks enjoy profit growth amid revenue challenges in 2025
In a year marked by economic turbulence and geopolitical uncertainties, the largest banks across Europe, the Middle East, and Africa (EMEA) have reported a paradoxical trend: shrinking or stagnant ...Read more
Banking
Australian major banks demonstrate resilience amid economic uncertainty
In the face of economic headwinds, Australia's major banks have reported robust half-year results, showcasing their resilience amid rising uncertainty. According to KPMG’s Australian Major Banks Half ...Read more
Banking
RBA's new ruling on card surcharges sparks debate among businesses and banks
In a significant move aimed at enhancing transparency and fairness in the Australian payments landscape, the Reserve Bank of Australia (RBA) has announced the removal of surcharging on debit, prepaid, ...Read more
Banking
Australian SMBs lose two business weeks annually to late payments, report finds
In a startling revelation, the latest report by GoCardless, a global bank payment company, highlights the crippling impact of late payments on small and medium businesses (SMBs) across AustraliaRead more
Banking
Brighten’s reverse‑mortgage bet: why a niche product could be non‑banks’ next profit engine
Brighten has created a dedicated reverse‑mortgage leadership post, signalling a strategic push into equity release as Australia’s demographic curve tilts older and wealth concentrates in housingRead more
Banking
Why banks are moving at different speeds after the RBA hike — and how to turn timing into advantage
The Reserve Bank’s latest cash rate move has triggered an uneven response from lenders — a pattern that reveals more about funding structures, risk appetites and systems readiness than headline ...Read more
Banking
ANZ’s company-borrower mortgage clampdown: a risk reset with wide spillovers for SMEs, investors and non-banks
ANZ has tightened credit settings for home loans where the borrowing entity is a company — a narrow policy change with broad commercial consequences. It signals a shift in risk appetite across ...Read more
